By Jennete Ugo Anya<\/b><\/p>\n
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Private sector activity across Africa expanded in the first quarter of 2026, with six of eight tracked economies recording Purchasing Managers\u2019 Index (PMI) readings above 50, signalling growth. This marks a gradual improvement from five expansions in Q1 2025 and three in Q1 2024, despite rising geopolitical tensions linked to the United States\u2013Israel\u2013Iran conflict.<\/p>\n
DECISION HIGHLIGHT<\/strong> DECISION MEMO <\/strong> Christopher Legilisho, economist at Stanbic Bank, noted: \u201cFirms reported expansions in output, new orders and employment, implying broad-based growth driven by robust client purchasing power.\u201d Yet this expansion is not efficiency-led; it is cost-pass-through driven, as firms raise prices to protect margins.<\/p>\n South Africa\u2019s lagging performance underscores structural drag. David Owen, senior economist at S&P Global Market Intelligence, observed: \u201cThe downturn intensified\u2026 as customers reacted to higher prices and broader economic headwinds.\u201d This highlights weakening demand elasticity under inflationary pressure.<\/p>\n The broader signal is that Africa\u2019s recovery is not synchronised. Expansion is occurring, but its quality is uneven\u2014tilted toward consumption resilience rather than productivity or export strength.<\/p>\n DATA BOX<\/strong><\/p>\n WHO WINS \/ WHO LOSES<\/strong><\/p>\n POLICY SIGNALS<\/strong><\/p>\n INVESTOR SIGNAL<\/strong><\/p>\n RISK RADAR<\/strong><\/p>\n <\/p>\n","protected":false},"excerpt":{"rendered":" By Jennete Ugo Anya Private sector activity across Africa expanded in the first quarter of 2026, with six of eight tracked economies recording Purchasing Managers\u2019…<\/p>\n","protected":false},"author":2,"featured_media":4789,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[2],"tags":[1508,877,2192],"class_list":["post-4785","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy-policy","tag-africa-economy","tag-inflation","tag-pmi"],"yoast_head":"\n
\nFirms across multiple markets increased output, hiring, and inventory accumulation, indicating forward positioning for demand\u2014despite escalating input costs and supply disruptions.<\/p>\n
\nThe latest PMI data presents a dual-speed African recovery: demand-led expansion in select economies coexists with cost-induced contraction elsewhere. Uganda\u2019s performance illustrates a domestically anchored growth model, where consumer demand and macro stability offset external shocks. In contrast, Egypt\u2019s contraction reflects vulnerability to imported inflation and geopolitical spillovers.<\/p>\n\n
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